1. Field of Invention
The present invention relates generally to the financial service and banking industries, and, more particularly, to systems, program products, and associated computer-implemented methods for providing a micro-loan product to prepaid cards and for managing access to a line of credit for a prepaid card.
2. Background
It is known that tens of millions of consumers in the United States have either limited or no access to traditional credit, either as a result of poor or limited credit history. It is further known that millions of prepaid cards are issued each year in the United States. It is also known that many of the consumers with prepaid cards rely primarily on cash and a prepaid card account for their personal finances; these consumers, for example, often do not have a traditional checking, savings, or other bank deposit account, and they usually do not write checks. It has been acknowledged by many that those without bank accounts and who often rely on prepaid cards may be underserved. These consumers are typically not easily able to access credit through traditional banking channels, though they may have an ongoing relationship with a prepaid card issuer, for example.
It is recognized that short-term lending is a $20 billion plus per year industry, and some industry experts believe an appropriate manner of offering micro-lending may be through a federal bank, especially to those underserved, such as those not having a checking account or other bank deposit account. Yet there can be many obstacles to those being underserved to using a federal bank or any bank for that matter, based on, for example, lack of effective bank products, risks associated with bank products, use of FICO scores to determine credit availability, and costs to those being underserved does not, or is not perceived to, outweigh the benefits for use of existing bank products.
As described in U.S. Provisional Patent Applications Ser. No. 61/032,750 titled “Methods, Program Product, and System for Micro-Loan Management” filed on Feb. 29, 2008, Applicants have previously provided introductory micro-lending and line of credit and products to those underserved by traditional bank products. Yet those consumers with access to and experience with non-traditional micro-lending and line of credit bank products, whether through a payroll prepaid card or similar program, however, may still be underserved by the terms available with these introductory products.